US-Japan Trade Deal Slashes Tariffs to 15 Percent, Secures 550 Billion in Strategic Investments for Key Industries
06 February 2026

US-Japan Trade Deal Slashes Tariffs to 15 Percent, Secures 550 Billion in Strategic Investments for Key Industries

Japan Tariff News and Tracker

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Welcome to Japan Tariff News and Tracker, your essential update on the evolving US-Japan trade landscape under President Trump.

In a landmark move, the US-Japan Strategic Trade and Investment Agreement, announced July 22, 2025, slashed Japan's reciprocal tariff baseline from the Liberation Day rate of 24 percent to 15 percent, effective August 7 via White House modification on July 31 and Executive Order 14345 on September 4, according to the Council on Foreign Relations' tracking of Trump's trade deals. This deal also caps Section 232 tariffs on Japanese automobiles and parts at 15 percent, down from Trump's March 2025 announcement of 25 percent, while granting exemptions for products under the WTO Agreement on Trade in Civil Aircraft and select unavailable goods like pharmaceuticals.

Japan committed to a staggering $550 billion in investments in core US industries including shipbuilding, critical minerals, energy, pharmaceuticals, and semiconductors, as detailed in a memorandum of understanding. According to GlobalCapital, this massive pledge emerged after Trump threatened up to 25 percent tariffs to tackle the US trade deficit, positioning Japan as a key player in revitalizing American industry. President Trump hailed it as proof of the strong US-Japan bond, while Prime Minister Sanae Takaichi stressed its mutual benefits for economic security. The Bank of Japan noted in a recent speech that higher US auto tariffs, up to 12.5 percent, have raised import prices but narrowed the US deficit more positively than expected.

Fresh developments: Trump announced progress on the trade deal via Truth Social, confirming a March 19 White House meeting with Takaichi, per ScanX Trade reports. Trade Compliance Resource Hub confirms Japan's modified reciprocal rates—zero percent for products with Column 1 duties at or above 15 percent, and 15 percent minus the duty for those below—hold steady with no recent hikes.

Listeners, as investments review ongoing projects in energy with no finalizations yet per CFR, stay tuned for impacts on markets and supply chains.

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